Thursday, December 14, 2017

Private players in energy sector need more support

In Summary

With Tanzania still facing a huge electricity deficit, it continues to dawn on everyone that we may not be able to power our industrial revolution by relying exclusively on the ailing Tanesco.

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Tanzania Electric Supply Company (Tanesco) continues to face upheavals even as the current government soldiers on with its efforts to turn the nation into an industrialised economy. With Tanzania still facing a huge electricity deficit, it continues to dawn on everyone that we may not be able to power our industrial revolution by relying exclusively on the ailing Tanesco.

Saddled with a myriad of challenges, including a huge debt, a dilapidated infrastructure and overreliance on hydropower, Tanesco – which hitherto produces an average of 1,400MW – is nowhere near achieving the close to 3,000MW the country needs to attain its ambitious industrialisation goal.

It comes as a great relief, however, that other organisations – including private players – are beginning to take up the challenge of investing in power production.

The recent announcement by TIB Development Bank that it would make available more than Sh90 billion for small power producers and renewable energy companies for solar distribution and installation provides a shot in the arm towards achieving that end.

With Songas also pondering to inject 60MW into the national grid, Tanzania’s industrialisation dream is inching towards fruition, albeit slowly. Of great interest is the fact that over three quarters of the TIB funds will be dedicated to long-term (up to 15 years) power generation.

With the world looking to move away from fossil fuels over their devastating effects on the environment, Tanzania – other than achieving energy sufficiency – could play a pivotal role in leading the region towards adoption of clean energy. Needless to say, the small power producers need all the support to boost their contribution to the energy sector from the paltry 100MW that they are currently producing.

The government alone will not be able to bring the industrialisation dream to reality without the support of capable players from multiple sectors.